Cape Council continues to talk finances

August 6, 2013

Councilmember Lenny Nesta brought the council some questions the board had before it moves forward on the city's three-year budget in regards to the pension and on the possibility on a surcharge tax of a half-percent on roads as part of its continuing "revenue diversification" plan.

On the latter subject, Councilmember Chris Chulakes-Leetz sought the difference between a sales tax and a surcharge. Finance Director Victoria Bateman explained that a surcharge can be used for a road tax and infrastructure, however, it would take a lot of bureaucratic red tape to get it through.

A sales tax, meanwhile, would have to be approved by referendum by Lee County voters, and Bateman said the city can't count on county voters to answer their diversification issues.

"A few of the members would like to see about council pursuing the surcharge," Bateman said. "Which would be for the road service tax we don't currently have."

Chulakes-Leetz did not agree with a surcharge. He said the city should speak with the county over the potential of a 1-cent sales tax so they could gain the revenue from the hundreds of thousands of visitors that come to Lee County annually.

City Manager John Szerlag was happy about the possibility of another revenue stream.

"If the city council wants to get together with the Board of County Commissioners and were successful in getting the half-cent sales tax, that would mean an extra diversification stream," Szerlag said. "If it raises $5 million, that would come back as a millage reduction or a reduction in the fire assessment."

Councilmember Kevin McGrail said it is something the city's Metropolitan Planning Organization board has discussed, especially with the 6-cent-a-gallon gas tax funds going down due to less driving and the use of more fuel-efficient cars.

The talk was of introducing a 1-cent sales tax in lieu of the 11-cent gas tax.

"The municipalities would have more income, but where's the guarantee the oil companies would refund the entire 11 cents?" McGrail said. "This will go to referendum, and the taxpayers will want to know that the gas tax will be rebated to the drivers."

McGrail also cautioned the Community Redevelopment Agency to know its boundaries, unlike its predescessor.

"This is an advisory board and not a policy-setting board. That's the problem we had the last time when we had a board not only come forward with recommendations, but also policy," McGrail said.

As for the pension issue, most on council said they were welcome to tackle the issue for as long as they wanted and if it felt it could make a difference.

"It seems the changes we've made with the bargaining units year by year (did the job)," Derrick Donnell said. "They're welcome to it, but it's a monstrosity."

In other business, the city council approved three consent items. Two of them approved modifying wireless equipment at communications towers located at Fire Station No. 6 and Verdow Park. The other was for a warranty deed for a lift station for the Southwest 6&7 utilities expansion project.

Also, the city honored the staff of SunSplash for again earning a five-star rating, the highest a water park can receive.

The council also allowed the city manager to fill the position of parks superintendent for a salary up to the maximum (about $74,000) to replace longtime superintendent Bob Burg.

Two ordinances were introduced. One would establishes a South Cape Community Redevelopment Agency (CRA) advisory board. A public hearing date was set for Aug. 19.

The other approves the form of two state revolving fund construction loan agreements with the state DEP in an amount expected to be about $89 million. Public hearing is slated for Aug. 21.